Paying off credit card debts without the use of debt consolidation or a balance transfer credit card which allows consumers to consolidate debt can be accomplished in many situations as there are some individuals who feel that a debt consolidation loan or balance transfer credit card option is simply not the best way to combat a consumer’s credit card problems. Understandably, consumers will acquire credit card debt for a variety of reasons and there are instances where these debts can simply get out of control, but when it comes to erasing these forms of debt obligations, there are methods which have been used by consumers to help them avoid the need for a debt consolidation loan or, again, a credit card balance transfer option.
Consumers who may have simply spent beyond their means to repay typically want to avoid a debt consolidation loan as it could only enable their bad credit practices since they may find they can afford the monthly payment that a consolidation option offers and, oftentimes, will continue to acquire debt in other areas, like the credit cards they may have paid off with a consolidation loan. It’s these poor financial practices that have led consumers to seek out a debt consolidation loan that concerns many advisors since moving debt around and erasing debt entirely our two very different practices.
As an example, financial advisor Dave Ramsey has stated on his website that debt consolidation loans can be more costly and, again, hide underlying financial problems that consumers may have that need to be addressed. If consumers often find themselves in a poor financial position and in need of debt relief assistance, simply consolidating debt as a way to find more affordability when repaying will not help a consumer to develop better budgeting, spending, and repayment habits within their personal life.
For this reason, one of the main methods that many cardholders used to erase debts without the use of consolidation is by simply attacking their credit card debts one source at a time, but even this practice has advisors who will differ on how to best proceed. In some cases, cardholders are told to look at their credit card debts and see which has the smallest principal balance remaining. After that, consumers have then been told to focus as much money as they can on this small principle debt while meeting minimum requirements on other cards, as this small principal credit card debt could be easier to erase and leave the consumer in a position where they can use these additional funds to proceed in like manner on the next smallest credit card debt obligation.
However, there are consumers who feel that using this method is better accomplished if a consumer pays off credit cards with a higher interest rate first, as the principal amount associated with high interest debt will cause the overall costs that must be paid to increase if the consumer continually meets minimum payments. While both of these options can be helpful, consumers must look at their personal financial position before deciding what method is right for them and during this repayment process implementing strict budgetary habits will be vital so that more debt is not acquired once consumers begin to see debt relief from these repayment practices.
Some consumers may need to turn to credit counseling to help them with their budgeting needs, but many consumers have been able to simply sit down, review their income versus their debts, and cut on the unnecessary areas of spending so that they may focus more money on paying down either credit card balances that have a low balance or a high interest rate. Yet, consumers who are in danger of missing payments on their credit cards may need to take more severe actions in order to avoid missed payments, so not letting credit card debt become too overwhelming before implementing these repayment methods will also be necessary so that consumers can begin paying off their credit cards without using a debt consolidation loan.